A major coalition of investors is calling on global governments to accelerate action to tackle the climate crisis.
The group of 587 investment firms with a collective $46 trillion (£37.3 trillion) in assets under management – a massive 40 per cent of the global total – have signed a statement to world leaders pressing them to take five urgent actions before the COP26 climate talks in November.
The 2021 Global Investor Statement urges governments to raise their climate ambition to limit global warming to no more than 1.5 degrees, implement meaningful emissions reduction policies, make climate-related financial reporting mandatory, and deliver COVID-19 economic recovery plans that support a transition to net-zero emissions by 2050 or sooner.
Climate change is widespread, rapid and intensifying
It comes hot on the heels of a damning report from the Intergovernmental Panel on Climate Change that found climate change is “widespread, rapid and intensifying,” and concluded that the effects can, and must, be limited by “strong and sustained reductions in emissions.”
The statement warns that if investors and governments fail to step up their action against climate change, the world could heat up by more than 3°C this century, far surpassing the 1.5°C limit set by the Paris Agreement in 2015. It reads: ‘To achieve this common goal, we must work together to reduce global net carbon dioxide emissions by 45 percent from 2010 levels by 2030, with a dramatic reduction of all greenhouse gas emissions essential for reaching net-zero emissions by 2050 or sooner.”
Investment opportunities
It adds that implementing promises made in the Paris Agreement will lead to attractive investment opportunities. It says: “…we believe that those who set ambitious targets in line with achieving net-zero emissions and implement consistent national climate policies in the short to medium-term, will become increasingly attractive investment destinations.
“Full implementation of the Paris Agreement will create significant investment opportunities in clean technologies, green infrastructure and other assets, products and services needed in this new economy.”
Signatories include Good With Money ‘Good Egg’ firm EQ Investors, WHEB Asset Management, Tribe Impact Capital, Union Bancaire Privée (UBP), Schroders, Impax Asset Management, Fidelity International, Aviva and Trillium Asset Management.
Louisiana Salge, senior sustainability specialist at EQ Investors, said: “EQ Investors is committed to pursuing a net-zero emissions, climate resilient and prosperous future. Joining the 2021 Global Investor Statement continues our efforts to manage climate risk and pursue the enormous investment opportunities in the global net-zero emissions transition.
“We are committed to aligning our investments with the goal of net-zero emissions by 2050 or sooner, reporting on climate risk, and developing comprehensive Investor Climate Action Plans (ICAPs).”
The five urgent requests for governments:
- Strengthen national commitments to reduce carbon emissions for 2030 before COP26 and plan for net-zero emissions by 2050
- Commit to net-zero emissions by 2050 and create a transition plan with ‘ambitious interim targets’
- Bring in domestic policies to support national climate targets, such as carbon pricing, removing subsidies for fossil fuels and avoiding new carbon-intensive projects
- Make sure Covid-19 recovery plans support the transition to a low-carbon economy
- Implement mandatory climate disclosure rules
